Most of us spend decades building up assets such as a home, a pension, savings, and investments, with the people we love in mind. Yet when it comes to planning how that wealth actually passes on, many families leave things to chance, assume it will sort itself out, or simply put off a conversation nobody particularly wants to have.
The reality is that inheritance planning, done well, is one of the most meaningful things you can do for the people who matter most to you. And a financial adviser can make the difference between a process that goes smoothly and one that becomes a source of real stress, or a much larger-than-necessary tax bill.
The stakes have never been higher
Inheritance tax (IHT) is no longer just a concern for the very wealthy. HMRC collected a record £8.2 billion in inheritance tax receipts in 2024/25 — up 10.8% on the previous year — driven by frozen tax-free thresholds and rising property values. The Office for Budget Responsibility forecasts receipts will reach £9.1 billion in 2025/26, and potentially more than £14 billion by the end of the decade.
The nil-rate band — the threshold below which no IHT is paid — has been frozen at £325,000 since 2009. As house prices have risen, more families have quietly crossed into IHT territory without ever intending to. From 2027, unspent pension funds will also be brought into estates for IHT purposes, pulling in thousands more families who previously hadn’t considered this a concern.
There is, however, an additional relief that many families don’t know about — and that can make a significant difference. The Residential Nil Rate Band (RNRB) provides an extra £175,000 of tax-free allowance when a home is left directly to children or grandchildren. Combined with the standard nil-rate band, this means an individual could potentially pass on up to £500,000 without any IHT liability. For married couples or civil partners, both sets of allowances can be combined — meaning a couple could pass on up to £1 million to their children completely free of inheritance tax.
To illustrate: a couple with a combined estate of £900,000 — including a family home — leaving everything to their children could, with all allowances properly claimed, face no IHT at all. Without that planning in place, or if the will isn’t structured correctly, the picture can look very different. It’s also worth knowing that the RNRB begins to taper away for estates above £2 million, reducing by £1 for every £2 over that threshold and disappearing entirely for individuals once an estate reaches £2.35 million. For larger estates, this makes early planning even more important. A financial adviser, working alongside a solicitor, can ensure the right structures are in place to make the most of these allowances before it’s too late.
Planning ahead isn’t just sensible. For many families, it’s becoming essential.
Getting your affairs in order
One of the most practical things a financial adviser can do is help you take stock of everything you have — and make sure the right structures are in place to protect it.
This means reviewing your will (and making sure you have one — research by Canada Life found that over half of UK adults do not have a will, including 30% of those aged 55 and over), ensuring beneficiary nominations are up to date on pensions and life insurance, and checking that assets are held in the most appropriate way. It also means knowing where everything is. Wills stored in a drawer nobody knows about, pension policies with outdated nominees, forgotten accounts, these create serious complications for executors at an already difficult time.
A good adviser helps clients, in the words of one experienced practitioner, “die neatly”, ensuring that wills, trusts, documents and account details are organised and accessible, so that those left behind can focus on grieving rather than administration.
Using gifting wisely
For many people, the most rewarding part of inheritance planning is giving with a warm hand rather than a cold one, seeing the people they care about benefit from their wealth while they’re still around to enjoy it.
There are meaningful allowances available that allow money to move out of your estate without IHT consequences, but they require planning. The annual gifting exemption, regular gifts from surplus income, and the seven-year rule on larger gifts all offer genuine opportunities to reduce an eventual IHT liability, but they need to be used thoughtfully and in the right sequence.
A financial adviser will help you give in a tax-efficient way without compromising your own financial security. As one adviser puts it simply: the key is not giving away so much that you leave yourself short in later life.
Having the conversations families avoid
Inheritance planning isn’t just a financial exercise… It’s a family one. And it often involves conversations that people would rather defer indefinitely: talking about death, about money, and about who gets what and why.
A financial adviser can play a quiet but important role in facilitating those conversations. They can bring clarity, neutrality and structure to discussions that might otherwise become fraught. This is especially valuable in blended families, where relationships are more complex, or where beneficiaries have very different financial circumstances.
It’s also about making sure the people who will eventually inherit are prepared. An unexpected windfall can be as disorienting as it is welcome, particularly for younger beneficiaries who haven’t developed the financial habits or knowledge to manage it well. Some advisers actively work with clients’ children as part of the planning process — building financial literacy across generations and ensuring that wealth is a source of security rather than stress.
Working alongside solicitors and accountants
A financial adviser won’t replace your solicitor or accountant, but they’re often the person who holds the whole picture together. Estate planning frequently involves all three working in concert: the solicitor drafting the will and any trusts, the accountant handling tax returns, and the adviser ensuring that investment structures, pension nominations, insurance policies and gifting strategies all align with the broader plan.
This joined-up approach matters enormously. Families where these conversations happen in silos, a will written without reference to pension nominations, or gifts made without tax advice, can inadvertently create problems that proper coordination would have avoided. An adviser who orchestrates these relationships, rather than simply handling their own piece of the puzzle, quickly becomes indispensable.
When the time comes
Even the best-laid plans are tested in practice. When someone dies, their family faces not only grief but often, for the first time, the full complexity of estate administration. According to the 2024 Bereavement Index, 91% of people found at least some aspects of the estate administration process stressful, with more than half reporting that it took much longer than they expected.
A financial adviser who already knows the family, understands the estate, and has helped ensure the paperwork is in order can provide real continuity at this point. This is particularly true for a surviving spouse who may not have been closely involved in managing finances, suddenly having to navigate pensions, investments and paperwork alone, at the worst possible time.
Advisers speak of this as one of the most valued things they do: helping a widow or widower manage their affairs through the immediate aftermath of loss, providing both practical guidance and a steady, reassuring presence.
The peace of mind that comes from planning
Inheritance planning is one of those things that can feel easy to defer. There’s rarely an urgent deadline, the conversations are uncomfortable, and most of us prefer not to dwell on our own mortality.
But the families who do plan — who have a will that reflects their wishes, whose assets are structured sensibly, who have thought through the gifting strategy and had the conversations with their children — almost universally feel better for it. Not just financially better, but emotionally better. There’s a particular peace of mind that comes from knowing the people you love won’t be left with confusion, conflict or an avoidable tax bill.
That peace of mind is worth a great deal. And it starts with a conversation. Contact Us
The value of investments can go down as well as up, and you may not get back what you invest. This article is for information purposes only and does not constitute financial advice. Tax treatment depends on individual circumstances and may change. Please speak to a qualified financial adviser to discuss your personal circumstances.